Delaware Employer Guide

Delaware Household Employer Guide 2026

Your household employee — a nanny, caregiver, housekeeper, or anyone who works in your Delaware home — is a W-2 employee. Delaware household payroll includes UC-8 unemployment filings, optional W-4DE state withholding, Delaware Paid Leave contributions, a Wilmington wage tax if your home is in city limits, and workers' comp once the domestic-worker threshold applies.

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✓ Updated May 2026 · Verified against Delaware Division of Revenue, Delaware Department of Labor, Delaware Division of Paid Leave, City of Wilmington, and IRS
Minimum Wage$15/hr
Paid Leave0.32%+
UI FilingUC-8
Workers' Comp$750/qtr
Wilmington Tax1.25%
Delaware is a moderate-complexity household-payroll state. The main Delaware-specific items are unemployment insurance through quarterly UC-8 filings, optional state income-tax withholding by mutual agreement, Delaware Paid Leave contributions, workers' compensation once a domestic worker earns $750 or more in a quarter, and Wilmington's 1.25% wage tax if the work is performed inside city limits.
Your household worker is a W-2 employee. Most household workers are employees under IRS rules, not contractors. Issuing a 1099 in this situation can lead to back tax penalties, interest, and wage-law liability.

When the rules apply

Delaware household employers mainly need to watch federal payroll thresholds, Delaware's first-dollar unemployment registration rule, and the workers' comp threshold for domestic workers.

2026 Thresholds
$3,000
Federal · 2026
Triggers Social Security and Medicare taxes (FICA) and W-2/W-3 reporting.
$1,000
Federal/quarter
Triggers federal unemployment tax (FUTA), reported on Schedule H with your personal tax return.
First dollar
Delaware UI
Delaware unemployment insurance applies from the first dollar of Delaware wages and is filed quarterly on Form UC-8.
$750
DE workers' comp/qtr
Domestic servants in private homes are exempt from Delaware workers' comp only when paid less than $750 in cash in a 3-month period from one household.

How Nest Payroll handles this

Each pay period, you pay your employee the net amount directly — through Venmo, Cash App, Zelle, your banking app, or by check. Nest generates the pay stub, calculates federal payroll taxes and Delaware deductions, and supports quarterly Delaware filings once your state accounts are active.

Federal taxes — quarterly EFTPS payments

At the end of each federal quarter, Nest debits your bank account for federal taxes owed and remits them to the IRS via EFTPS. At year-end, Schedule H on your Form 1040 reconciles those household payroll taxes.

Delaware state taxes — UC-8, Paid Leave, and local tax if applicable

Nest supports Delaware unemployment reporting on Form UC-8, Delaware Paid Leave contributions, optional Delaware income-tax withholding, and Wilmington city wage tax treatment if your household is inside Wilmington city limits.

Set up payroll in 5 minutes.

Nest handles Delaware payroll calculations, paystubs, UC-8 filings, Paid Leave contributions, Wilmington wage tax support if applicable, and year-end Schedule H.

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Setup checklist (before they start)

Delaware Workers' Compensation Insurance

Delaware generally requires workers' compensation for employers with one or more employees. Domestic servants in a private home are exempt only when paid less than $750 in cash in any 3-month period from one household. If you pay a nanny, caregiver, housekeeper, or other domestic worker $750 or more in a quarter, coverage is generally required.

Do not skip coverage if required. Delaware can impose penalties, and an injured household worker may be able to sue directly if you are uninsured. Talk to your insurance agent before the employee starts.

Form I-9 (Employment Eligibility)

Have your employee complete the Form I-9 at hire to verify they're authorized to work in the United States. You don't submit this anywhere — keep it filed in case of audit.

Federal W-4 + Form W-4DE (optional Delaware withholding)

The federal W-4 determines federal income tax withholding if you and your employee agree to withhold it. Delaware uses Form W-4DE for state withholding.

Federal and Delaware income tax withholding are both voluntary for household employers and require mutual agreement between you and your employee.

Delaware New Hire Reporting

Delaware requires all employers to report newly hired and rehired employees to the Delaware New Hire Reporting Center (via the Division of Child Support Services) within 20 days of the hire date.

You'll provide your employee's name, address, SSN, hire date, and your contact information.

Required Employment Posters

Delaware requires several employment posters in the workplace. For a household, "the workplace" is your home — but you should still keep a binder with the required notices and confirm with your employee that they've reviewed them. Required posters include:

  • Delaware Minimum Wage poster (DE DOL)
  • Delaware Paid Leave notice (DE Division of Paid Leave)
  • Delaware Workers' Compensation notice
  • Federal "EEO is the Law" + FLSA Min Wage posters

Written Work Agreement

Delaware does not require a written work agreement for household employment, but having one in writing protects everyone. A good agreement covers: pay rate, hours, schedule, duties, paid time off, holiday pay, sick leave accrual, mileage reimbursement policy, termination process, and confidentiality. Use Nest's free Nanny Contract Template to get started.

Pay & compensation

Minimum Wage — $15.00/hr (Jan 1, 2025) — federal $7.25 superseded

Delaware's minimum wage is $15.00 per hour as of January 1, 2025 (under 19 Del. C. § 902, the staircase set by SS 1 to SB 15 reaching $15 on January 1, 2025 from prior steps). The 2026 rate remains at $15.00. Tipped employees in Delaware have a separate tipped minimum, but household employees are typically not tipped employees.

Overtime — 1.5× regular pay over 40hr/week

Worker type Overtime rule Source
Live-out (works at your home but doesn't reside there) 1.5× regular rate over 40 hours per week FLSA + 19 Del. C. § 901
Live-in (resides at your home) Exempt from FLSA overtime; no Delaware state rule extending overtime to live-in domestic workers 29 USC § 213(b)(21)

"No Tax on Overtime" Deduction (2025–2028)

The federal overtime deduction may let household employees deduct the premium portion of qualifying overtime pay on their personal tax return. This is a federal income-tax rule; it does not change how you calculate overtime, FICA, Delaware withholding, Paid Leave, Wilmington wage tax, or payroll records.

With Nest Payroll: Nest tracks qualified overtime reporting for W-2 purposes when required.

Wilmington City Wage Tax — 1.25%

The City of Wilmington imposes a 1.25% wage tax on wages earned within city limits. If your employee works at your home and your home is in Wilmington, the tax generally applies regardless of where the employee lives.

If your home is outside Wilmington city limits, the Wilmington wage tax does not apply.

Pay Frequency

Household employees are usually treated as non-exempt hourly workers under FLSA rules — even when you've agreed to pay a "salary," federal FLSA treats it as a wage covering a fixed number of hours per week, with overtime owed on hours past 40.

Under 19 Del. C. § 1102, Delaware employers must pay wages at least monthly. Most household payroll arrangements pay weekly or biweekly to keep cash flow predictable for both sides.

Mileage Reimbursement

Delaware does not require employers to reimburse mileage at the IRS standard rate, but if you ask your employee to use their personal vehicle for work-related driving (e.g., kid pickups, errands), you should reimburse them. The 2026 IRS standard mileage rate is 70 cents/mile for business use. Reimbursement at the IRS rate is non-taxable income for the employee.

Paystub Requirements

Under 19 Del. C. § 1108, Delaware employers must provide an itemized wage statement with each paycheck showing: hours worked, gross wages, all deductions (federal income tax, FICA, DE state income tax if opted in, DE Paid Leave contributions, Wilmington city tax if applicable), net pay, and pay period dates.

Time off & leave

Paid Sick Leave

Delaware does not have a statewide paid sick leave law for household employees. Delaware Paid Leave (see below) covers medical, family caregiver, and parental leave through a separate state-administered program.

Delaware Paid Leave is a state-administered payroll contribution program. For typical households with fewer than 10 employees, the main line is Parental Leave at 0.32% of wages. Employers and employees may split the contribution up to 50/50, meaning the employee share is capped at 0.16% for that line.

Typical household pattern: Medical Leave and Family Caregiver Leave generally apply at 10+ employees. Most households should verify employer-size status directly with the Delaware Division of Paid Leave before enrolling.

Vacation & PTO

Delaware does not require paid vacation. If you offer it, your written policy should clearly explain accrual, carryover, and payout at separation. If your policy is silent, unused vacation may be treated as payable wages.

Keep sick and vacation banks separate. Combining sick and vacation into a single PTO bank can make the whole balance look like vacation for payout purposes.

Upon departure

When the working relationship ends — whether the employee resigns or you terminate — Delaware's final pay rule (19 Del. C. § 1103) requires final wages to be paid by the next regular payday following separation. Pay any earned-but-unused vacation per your written policy. Provide Form W-2 at year-end (or earlier if requested by the employee).

Year-end forms

Your responsibilities

  • Hand the W-2 to your household employee by January 31 — Nest produces this; you deliver it
  • Attach Schedule H to your Form 1040 by April 15 — Nest produces a signature-ready version

What Nest handles for you

  • Quarterly federal tax payments to the IRS via EFTPS
  • W-3 + Copy A of W-2 filed with the Social Security Administration
  • Quarterly Form UC-8 filings through the Delaware DOL portal
  • Delaware Paid Leave contributions through the Division of Paid Leave portal when applicable
  • Wilmington city wage tax filings if your home is in Wilmington
  • Annual Delaware withholding reconciliation if Delaware PIT withholding applies
With Nest Payroll: Your tax forms are generated automatically and appear in your Tax Summary by the end of January.
Bonuses and vacation payouts: Bonuses and vacation payouts are included on your employee's W-2 and taxed through regular payroll withholding calculations.

Tax breaks for household employers

Three federal tax provisions can offset the cost of household employment:

  • Child and Dependent Care Tax Credit (CDCTC) — Up to 35% of $3,000 (one qualifying child) or $6,000 (two or more) in care expenses on Form 2441 with Form 1040.
  • Dependent Care FSA (DCFSA) — If your employer offers one, you can set aside up to $5,000 per year (single or married filing jointly) of pre-tax salary to pay for care. The OBBBA increased this to $7,500 starting 2026.
  • Delaware state credit — Delaware offers a state child and dependent care credit on Form PIT-RES, mirroring a portion of the federal CDCTC.

Resources & free tools

🧮 Nanny Payroll Calculator ⏪ Catch-Up Calculator ↗ Gross-Up Calculator 📄 Free Contract Template 🏖️ Frontload PTO & Payout Guide 📚 Nanny Payroll 101

The information on this page is general in nature and not tax, legal, or financial advice. Delaware rules change. Verify current rates and rules with the Delaware Division of Revenue, Delaware Department of Labor, Delaware Division of Paid Leave, and City of Wilmington, or consult a tax advisor.